Warning over impact of 'super-aged' societies on economic growth

Euronews

‘Super-aged’ societies are coming and they are going to drag down economic growth.

According to research done by analysts at credit ratings agency Moody’s we need to start worrying about aging populations.

They have calculated there is going to be a dramatic increase in the number of “super-aged” countries – that is where more than one in five of the population is 65 or older.

Currently there are just three – Germany, Italy and Japan.

But by 2030 there will 34 such countries, with fewer workers to support the cost of retirees and less investment because saving rates will decline.

Between 2015 and 2030 growth in the number of people of working age is set to be only a little over half the growth seen during the previous 15 years.

Anne Van Praagh, Managing Director of Moody’s Sovereign Risk Group, said the problem will spread: “We have known about labour force shrinkage in places like Russia and Japan and Germany. We’ve known about labour force participation declining in the US. The fact is, this is not just a developed market problem, it’s a developing and emerging market problem, as well.”

Governments are now under pressure to respond by doing things like raising retirement ages and backing the development of technology to boost productivity for those who are still working.